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Competing against Skype 105: Value Added Resellers

Do you think Skype is a threat to incumbent telcos?

This is the fifth in a series outlining tactics telcos have at their disposal to answer the question "If you think Skype is a threat to your telecom profits, how can you compete?"

101: Pricing
102: Lobbying
103: Patent War 
104: Value Chain Denial

Tie-Up Telecom VARS and Consultants.
Distribution ecosystem attack.

Banana Split: The Value Chain in the conventional banana market

The next time your small business buys or installs a phone system, you'll probably get help. Local help. If you're lucky, there's a specialist for your industry who know just how to set things up.

Local resellers and telecom consultants are the human face for small and medium sized businesses and vertical markets. Telecom VARs (Value Added Resellers) influence SMB buying decisions. VAR mindshare is hard to win and mandatory for marketing through the channel.

Three flavors of attack:

  1. Threats. Think Sopranos: lots of innuendo with serious muscle behind it. Big vendors tell small VARs that supporting Skype or other vendors means losing their distribution relationship with [insert large telephone system vendor here]. In some markets this might even be written into contracts. When a supplier accounts for a quarter or more of your income, you take all forms of intimidation seriously.

  2. Burdens. Where direct threats aren't legal, contracts compel VARs to train staff and buy service inventory. These expensive components limit how many telephony vendors a VAR can afford to offer. To keep or push Skype out of a VAR channel, increase the burden.

  3. Bypass. Design solutions that don't need VARs to do anything but sell: Self-service DIY systems. All-mobile + web services. Hosted telephony. 

Skype launched its reseller program with the Skype Small Business Pack this Spring, first in Europe; more markets to follow.

Skype's reseller program can be successful in Europe where the Skype brand is known and understood. Like VoIP Watch's Andy Abramson, I'm less confident that Skype will be able to interest the average United States telecom VAR. Skype — "something consumers use" — is an alien concept. Skype will make inroads when it offers margin-dollars orders of magnitude larger than today and when customers plead for Skype solutions; neither happening in the next few quarters.

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Comments

that is well kool i think you should definately do it. you guys are all well cool and hot. thankyou for your time. jan qui

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